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Strategies & Market Trends : Ask DrBob -- Ignore unavailable to you. Want to Upgrade?

To: stan_hughes who wrote (42938)	8/25/2001 7:43:56 PM
From: kleht	Read Replies (1) \| Respond to of 100058

Thanks, Stan, for the S&P 500 Performance Table link (and although I don't respond a lot, I do appreciate your posts you've made on this board. Very informative). Although the table does not go back eons it does illustrate DrBob's admonishment against taking historical data too literally. I had always been under the impression that Sept is the worst month of the year and Oct closely follows. And yet here, over the past 14 years Sept, while having the most down months annually actually shows a tiny positive return on average. Oct shows a tiny negative return even with 1987 thrown in. And, as Don Hays was pointing out, Aug is near the bottom in terms of the most down months as well as having the worst of all return on average. I find it interesting to note the deviations at any given time from historical norms. And how we can easily be misled either by the historical norms or by ignoring the historical norms. Following historical norms, we would have been out of the bull market years ago when P/E ratios first skyrocketed to record highs, dividend yields dropped to record lows, the put/call 10-day m/a ratio dropped consistently below .50, etc. We are talking years here. And how about those ignoring historical norms? They made out like bandits - until they ignored the norms too long and overstayed their welcome. (ahem,, me, me, me - just clearing my throat. :) So, what's an investor to do? That's why I'm here on this board. I think TA done on a weekly and monthly basis would be an excellent guide. (For traders, of course, daily, hourly and less helps even more) If I had been following TA all along, I think I would be way ahead of the game. Hindsight tells me I would have done a lot more selling in early 2000. Still learning. Think I'll die pretty wise. Hope I'm not broke. :) Ken